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Why the IRS Should Automatically Fill In Returns With What It Knows

Posted by Soulskill on from the because-addition-is-mentally-taxing dept.

theodp writes "An article in the NY Times begins, 'In the digital age, filing income tax returns should be a snap. Important data from employers and financial institutions has already been sent to government computers. Yet taxpayers are still required to perform the chore of preparing a return from scratch, in many cases paying a software company for the privilege.' Why, if your needs are simple, can't you just download forms pre-filled with whatever data the IRS has received about you, make any necessary adjustments, and automatically get the IRS calculation of your taxes? Sounds reasonable, but the IRS rejected the President's proposal to give taxpayers the option to do so as 'not feasible at this time' due to delays in the receipt of W-2 and 1099 data. However, California managed to offer a pre-filled state tax return, which cost only 34 cents to process compared to $2.59 to process a traditional paper return. Despite the success of the pilot, meager funds have been allotted for the program due to the strength of its political opponents — 'principally, Intuit' — according to the state controller. Intuit argues it would be a 'conflict of interest for government to be both tax collector and tax preparer.'"

8 of 613 comments (clear)

  1. This is how it's done where I'm from... by Louai · · Score: 5, Informative

    In Finland you get a pre-filled tax sheet in the mail, you only have to return it if there are any changes you need to make. I'm currently living in the US, I find the amount of crap you need to go through to get your affairs in order absolutely stunning.

    1. Re:This is how it's done where I'm from... by nedlohs · · Score: 4, Informative

      Just wait until you do what I did and live in 4 different states in a year... Seriously 5 tax returns, some owed me, I owed some.

    2. Re:This is how it's done where I'm from... by c-reus · · Score: 5, Informative

      In Estonia, you log in to the web page of the IRS equivalent, click "Next" a few times, then click "Confirm" and you're all done. No dead trees involved.

    3. Re:This is how it's done where I'm from... by Neoprofin · · Score: 4, Informative

      The bastard thing is that most in the US overpay their taxes by having a portion withdrawn from each paycheck. "Paying our taxes" is just telling them that they ripped us off during the year and we'd like the money back.

  2. works fine in Sweden by BuR4N · · Score: 5, Informative

    pre-filled tax forms that you only have to sign and return have worked well here in Sweden for years, no conflict of interest at all. A couple of years ago, they even started with an SMS option, where you just can "ok" your pre filled tax form with an SMS code.

    If you want to add information, you can just fill in your own form and send it in, but I think its pretty common to just use the pre-filled tax form.

    --
    http://www.intellipool.se/ - Intellipool Network Monitor
  3. We've had that for years in Norway by TickTEC · · Score: 5, Informative

    Here in Norway, if you feel you have nothing to add, you don't even have to return the papers. Just sit back and relax. I've never had to fill out anything.

    --
    I'm gonna be famous, tell everyone!
  4. Re:people are lazy by samkass · · Score: 5, Informative

    the government will claim this or that, and people will just accept it. when an honest mistake by the government, nevermind malicious intent, might wind up overtaxing someone. most people will wind up spending say $2,000 more on their taxes, accepting the government's proposal unseen, rather than reviewing it for mistakes

    I don't have a problem with that. You can't save everyone. The amount of efficiency in the average case would be so great, though, that overall I suspect it would offer more money to both the government AND the taxpayer.

    --
    E pluribus unum
  5. UK Tax Returns by nanoakron · · Score: 4, Informative

    Here in the UK, most people pay tax through the PAYE (Pay-As-You-Earn) scheme. The only people who regularly don't are the self-employed.

    This means that the majority of the working population NEVER need to file tax returns.

    However, some people do regularly file tax returns -

    1. People asked to do so through random audit
    2. If you are considered a 'high-rate' taxpayer (meaning you earn more than about £36,000pa).

    But, you can elect to file a tax return even if you earn less than the 'high-rate', and you can often get some money back for overpayments.

    I still can't believe the amount of hassle you have to go through in the US each year when it comes to tax-time.

    -Nano.